Why is Gas Consumption Tanking?

Retail gasoline deliveries, already well below 1980 levels, have absolutely fallen off a cliff. Is the plunge inventory-related, i.e. are storage facilities so full that retailers are simply putting off deliveries?

Though I don’t have data on hand to support this, I know from one of my correspondents who is in the gasoline distribution/delivery business that gasoline is very much a “just in time” commodity: gas stations are often close to running out of fuel when they get a delivery. Stations aren’t holding huge quantities of surplus gasoline; that’s not how the business works.

Given the absence of “extra storage” in gas stations (and the fact that the number of gas stations has fallen dramatically since 1980), it is reasonable to conclude that retail delivery is largely a function of demand, i.e. gasoline consumption.

Even if you dismiss the recent plunge as an outlier, the declines in retail gasoline deliveries are mind-boggling.

2 comments

Well, I am no expert and I don’t own a crystal ball or anything else that is crystal but it doesn’t take a rocket scientist to know that some kind of sign should be showing with 30 million + on the dole.

The other sign is worse—-exporting our gasoline to other countries all the while touting the fact that gasoline could go up to $5 a gallon this year or higher. Never mind that the usurper is jumping up and down like a baboon yelling through his artificial smile NO DRILLING, NO DRILLING, NO DRILLING !!! And he didn’t even need the teleprompter. WOW !